<p>Governor Gavin Newsom (D-CA) is in disagreement with other Democrats regarding California’s proposed billionaire tax, publicly endorsing a ballot measure that aims to cancel the proposed tax on the state’s wealthiest residents.</p>
<p>California voters will decide on Proposition 40 during the upcoming midterm elections, which proposes a one-time, 5% net-worth tax on billionaire residents. The proposal has support from progressive Representative Ro Khanna (D-CA) and Senator Bernie Sanders (I-VT), but Newsom has expressed his opposition, advocating instead for a national billionaire tax. Critics of the state ballot measure are concerned that it may lead to industry leaders leaving California to avoid the tax.</p>
<p>On October 6, 2026, Newsom endorsed Proposition 42, a measure supported by opponents of Proposition 40, which seeks to nullify the billionaire tax even if it is approved by voters. Proposition 42 would prohibit taxes on personal property ownership and any retroactive taxes applicable to a taxpayer’s previous activities.</p>
<p>“I am proud to stand with firefighters, blue-collar unions, veterans, seniors, and small businesses in support of Prop 42,” Newsom stated. “We all agree that Californians deserve to have their retirement and life savings protected from new state taxes so those savings are there when they need them. That’s why I’m voting Yes on Prop 42.”</p>
<p>The Service Employees International Union-United Healthcare Workers West has advocated for the billionaire tax, proposing that 90% of the tax revenue be allocated to the state’s healthcare system and 10% to public education and food assistance programs. The union has characterized the tax as a means to counteract what it describes as significant cuts to federal healthcare funding during the Trump administration.</p>
<p>Khanna, in an interview last week, referred to the initiative as “the most important ballot initiative in America and in the world.”</p>
<p>He added, “In California, a one-time 5% tax would allow us to prevent 3.5 million Californians from losing health insurance. This is a policy that could transform the economy, so it’s not just working for a few billionaires. And the question is, why are so many Democratic establishment people against this tax? It’s because these folks are funding the campaigns.”</p>
<p>A September poll conducted by the University of California, Berkeley and Politico indicated that 45% of voters support Proposition 40, while 42% oppose it, and 12% remain undecided.</p>